ISLAMABAD: Prime Minister Shehbaz Sharif hailed the staff-level agreement reached with the International Monetary Fund (IMF).
In a tweet, the prime minister said the deal will enable Pakistan to achieve economic stability. He said this agreement will help to strengthen Pakistan’s foreign exchange reserves and put the country on the path of sustainable economic growth.
The prime minister appreciated the efforts and hard work of Finance Minister Ishaq Dar and his team at the Ministry of Finance for achieving this outcome.
He also thanked Managing Director IMF Kristalina Georgieva and her team at the IMF for their cooperation and collaboration, especially during the course of last week.
Alhamdulillah, I am pleased to announce that Pakistan has reached a Staff-Level Agreement with the IMF on a nine-month US$3 billion Stand-By Arrangement. This Arrangement will help strengthen Pakistan’s foreign exchange reserves, enable Pakistan to achieve economic stability, and…
— Shehbaz Sharif (@CMShehbaz) June 30, 2023
The development comes after the IMF has reached a staff-level pact with Pakistan on a $3 billion stand-by arrangement. The deal come as sigh of relief for the nation facing a balance of payment crisis and dwindling foreign exchange reserves.
The deal, subject to approval by the IMF board in July, comes after an eight-month delay and offers some respite to Pakistan, which is battling an acute balance of payments crisis and falling foreign exchange reserves.
“Praise be to God,” tweeted Finance Minister Ishaq Dar after the deal was announced early on Friday. The government was expecting around $2.5 billion from the IMF.
An IMF staff team led by Nathan Porter meetings with the Pakistani Authorities to discuss a new financing engagement for Pakistan under an IMF Stand-by Arrangement (SBA).
The government was racing against time to unlock $1.1 billion under the IMF’s ninth review of a $6.5-billion Extended Fund Facility (EFF) agreed upon in 2019. The programme was due to expire on June 30.
{akistan earlier cleared eight of the 11 listed programme reviews, with the ninth review pending since November last year. The delay was already the longest since at least 2008.
The ninth review had been stalled due to differences between the fund and Islamabad over policy actions, including external financing needs and a budget that meets programme goals.
The initial draft of the 2023-2024 budget presented in parliament earlier this month failed to meet IMF expectations and was hurriedly revised to introduce new taxes and expenditure cuts.
The central bank also hiked the key rate by 100 basis points in an emergency meeting, barely two weeks after keeping the rate unchanged in a scheduled meeting.
